124 P. 518 | Mont. | 1912
delivered the opinion o'f the court.
On April 2, 1908, the defendant executed and delivered to Agnes Johnson his promissory note, of which the following is a copy:
“$500.00 Butte, Mont., April 2d, 1908.
“On demand after date for value received, I promise to pay to the order of Mrs. Agnes Johnson Five Hundred and no/100 Dollars in lawful money of the United States, negotiable and payable at Butte, Montana, with interest before and after maturity at the rate of (12) per cent, per annum from date until paid. The makers and endorsers hereby waive presentment, demand, protest, and notice thereof, and agree to pay reasonable attorney’s fees in case of suit on this note.
“(Signed) G. H. Wilson.”
Subsequently payments were made by him for which credits were indorsed as follows: “August 26, 1908, paid on principal $100.00; April 10, 1909, on principal $350.00.” On or about September 15, 1909, Mrs. Johnson, being indebted to plaintiff to the amount of $80.55 on account of grocery supplies furnished to her by it, transferred the note to it as security for the sum so due. She indorsed it: “Pay Brophy Company the balance due on this note.” This action originated in a justice’s court and was brought to recover $108.58, alleged still to be due on the note as principal and interest. The complaint is in the usual form. The answer contains a general denial and an allegation of payment to Mrs. Johnson prior to the date of the transfer. At the trial, after proof that the note had been indorsed to plaintiff by Mrs. Johnson for the purpose stated, counsel for plaintiff introduced it in evidence and rested. Thereupon C. W. Gamer,
The court and counsel for plaintiff proceeded upon the theory that the plaintiff was, as a matter of law, a holder in due course of the note in suit, and hence that evidence of payment by the defendant to Mrs. Johnson, prior to the transfer of which it had no notice by indorsement on the note, was immaterial and incompetent. The contention of counsel for defendant is that, in view of the character of the note and the length of time which had elapsed since its execution, the condition in which it was at the time it came into the hands of plaintiff, and the information communicated to Gamer touching the controversy over the amount, if any, then remaining unpaid, it was a question for the jury whether the plaintiff became a holder of it in due course, and hence that the court should have admitted the offered evidence.
As between the maker and payee, a note payable on demand is due as soon as it is executed. As between the maker and the indorsee, the latter is deemed to be the holder in due course if it has come into his hands for value in the ordinary course of business, within a reasonable time after its date. What is a reasonable time has never been fixed by definite rule, but has been held to be determinable by reference to the circumstances of each case. (Tomlinson Carriage Co. v. Kinsella, 31 Conn. 268; Pindar v. Barlow, 31 Vt. 529; Paine v. Central Vt.Ry. Co., 14 Fed. 269; Herrick v. Wolverton, 41 N. Y. 581, 1 Am. Rep. 461; Merrit v. Jackson, 181 Mass. 69, 62 N. E. 987; Wood’s Byles on Bills and Notes, p. 331.) Some of the courts, as an examination of the cases cited will disclose, hold that what is a reasonable time is
Considerable space is devoted in the brief of counsel for plaintiff to the question whether the note was negotiated within a reasonable time. So much as has been said on this subject is rather by way of digression. The pertinent inquiry presented upon this record is whether the plaintiff became a holder in due
“A holder in due course is a holder who has taken the instrument under the following conditions: 1. That it is complete and regular upon its face; 2. That he became the holder of it before it was overdue, and without notice that it had been previously dishonored, if such was the fact; 3. That he took it in good faith and for value; 4. That at the time it was negotiated to him he ■had no notice of any infirmity in the instrument or defect in the title of the person negotiating it.” (Rev. Codes, sec. 5900.)
The language of this section is free from ambiguity. Under it the holder is one in due course when it appears that all four conditions named are satisfied. Did the facts in evidence justify the court in holding that the plaintiff took the note before it was due and without notice that it had been previously dishonored? We think not. They made out a clear case of notice of dishonor. Though by express recital upon the face of the instrument the necessity for demand was waived, yet the payments indorsed upon it disclosed that the principal sum named had been nearly
The order is reversed, with directions to grant the defendant a new trial.
Reversed.